MEMORANDUM OF UNDERSTANDING
BETWEEN THE UNITED STATES POSTAL
SERVICE AND THE AMERICAN POSTAL
WORKERS UNION, AFL-CIO

APWU,USPS Announce Freeze on Excessing While
Contract Talks Continue

The APWU and the Postal
Service have agreed to a freeze on excessing while contract negotiations
continue, union President Cliff Guffey has announced. “Throughout the
bargaining process, the APWU has sought to negotiate a contract that would
protect jobs and lessen the pain of excessing for our members. We are
pursuing those goals,” he said.

In the meantime, the
moratorium on excessing is a demonstration of good faith that will make
the holidays a lot brighter for many of our members,” Guffey said. “The
freeze will remain in effect as long as bargaining continues, and will
apply to excessing outside of a craft or installation.”

Such excessing was imminent
in hundreds of locations, and would have affected thousands of employees.
The excessing will be halted at all sites while bargaining goes on, the
union president said.

“Union negotiators will
persevere in our efforts to negotiate a collective bargaining agreement
that meets our long-term goals,” Guffey added. “We have been working
diligently to reach an agreement that will benefit postal workers and the
Postal Service. We will continue our efforts until we reach a settlement –
or it becomes clear that an agreement cannot be reached. If we conclude
that a contract is not within our grasp, we are prepared to proceed to
arbitration.

“One of our top priorities is
to restore work that has been contracted out or assigned to supervisory
personnel. This would bring stability to APWU members who have suffered
severe hardships due to long-distance reassignments caused by excessing,”
he said.

“The proposals we have
submitted to achieve this objective also would benefit the Postal
Service,” Guffey said. “Our proposals would save the USPS money, because
our members can perform these duties more efficiently and less
expensively.”

In addition to job security
and alleviating the pain of excessing, the parties are discussing wages,
benefits and issues related to workforce structure.

Mediation,
Arbitration

The contract was originally
scheduled to expire Nov. 20, but the union and management extended the
deadline. The 2006-2010 Collective Bargaining Agreement will remain in
effect until a new agreement is reached through negotiation, mediation, or
arbitration.

Under the terms of the Postal
Reorganization Act of 1970, if the union and management fail to reach
agreement on a successor contract and do not agree on an alternate
procedure, the Federal Mediation and Conciliation Service (FMCS) appoints
a mediator. If a settlement is not reached within 60 days of the
expiration of the contract, both parties submit all outstanding issues to
binding arbitration.

If arbitration becomes
necessary, the APWU will appoint an arbitrator, as will the USPS. The two
party-appointed arbitrators will work with a neutral arbitrator to ensure
that each side’s interests are clearly understood.

“The APWU will continue our
efforts to negotiate a contract that benefits postal workers and the
Postal Service,” Guffey said. “I ask union members for their continued
support as this process unfolds.”

The APWU will continue to
provide frequent updates regarding the status of collective bargaining.
For the latest developments, please visit www.apwu.org. Members are also
encouraged to follow the union on Twitter and Facebook to receive
up-to-the-minute alerts by e-mail or text message.

In recognition of the parties’ efforts to respond
to the need to reposition the workforce by jointly seeking an approach that
is consistent with the principles of minimizing employee dislocation, consistent
with the needs of the service,
it is agreed that the Postal Service will petition the Office of Personnel
Management (OPM) for the purpose of implementing Section 8336(d)(2) (voluntary
early retirement -CSRS) and Section 8414 (b)(l)(B) (voluntary early retirement
- FERS) of Title 5, United States Code for all eligible APWU represented employees,
subject to the limitations imposed by OPM. The Postal Service will petition
OPM no later than February 1, 2003 and the union will be provided a copy of
the petition request.

The Postal Service will place a temporary moratorium on excessing and the
reassignment of employees through May 15, 2003. The plan to consolidate installations
will be provided to the union in December 2002. This moratorium will not apply
to current or future excessings and reassignments, where the APWU and the
affected employees receive notice in accordance with Article 12 of the 2000
National Agreement, provided that the impacted employees will be reassigned
within the local commuting area of their installation (a 50 mile radius).
If a need still exists to reassign employees after termination of the moratorium,
employees given notice of reassignment pursuant to Article 12 prior to the
date of this agreement will be reassigned.

In light of the need to
prepare for the possibility of employee reassignment, the parties agree that
the Postal Service will immediately begin withholding all residual vacancies.
The need for withholding these residual vacancies is provided by the consolidation
plan and recognized pursuant to this memorandum.

Any
disputes arising out of this memorandum will be handled in accordance with
the Memorandum of Understanding Re: Administrative Disputes Resolution Procedures
. This memorandum expires for all purposes on November 20,2005.

Having failed
in a timely manner to provide the APWU with a list of USPS facilities
that are to be consolidated or closed, the Postal Service has agreed
to extend the moratorium onexcessing beyond May 31. The deadline
for providing the finalized list of plant consolidations was Dec. 31,
2002. This target date had been set by the two-year contract extension.

With its failure
to meet its contractual obligation to let APWU members know which plants
are slated for consolidation, the Postal Service
has agreed to extend the moratorium on excessing proportionally with the
delay in providing the list of consolidations and closings.

In a related
matter also covered under the extended agreement, management is obliged
to petition the Office of Personnel Management for early retirement opportunities
by Feb. 1.

In effect since
Dec. 19, the contract extension was formally signed by both parties on
Jan.16.

(source: APWU )

MEMORANDUM OF UNDERSTANDING
BETWEEN THE UNITED STATES POSTAL
SERVICE AND THE AMERICAN POSTAL
WORKERS UNION, AFL-CIO

Re: Layoff ProtectionEach employee who is employed in the regular work force as of November
20, 2000, and who has not acquired the protection provided under Article 6
shall be protected henceforth against any involuntary layoff or force reduction
during the term of this Agreement. It is the intent of this Memorandum of
Understanding to provide job security to each such employee during the term
of this Agreement; however, in the eventCongress
repeals or significantly relaxes the Private
Express Statutes this Memorandum shall expire upon the enactment
of such legislation. In addition, nothing in this Memorandum of Understanding
shall diminish the rights of any bargaining-unit employees under Article 6.

Since this Memorandum of Understanding is being entered into on a nonprecedential
basis, it shall terminate for all purposes at midnight, November 20, 2005,
and may not be cited or used in any subsequent dispute resolution proceedings.

ARTICLE 6

NO LAYOFFS OR REDUCTION IN FORCE

(1) Each employee who is employed in the
regular work force as of the date of the Award of Arbitrator James J. Healy,
September 15, 1978, shall be protected henceforth against any involuntary
layoff or force reduction.

It is the intent of this provision to provide
security to each such employee during his or her work lifetime.

Members of the regular work force, as defined
in Article 7 of the Agreement, include full-time regulars, part-time employees
assigned to regular schedules and part-time employees assigned to flexible
schedules.

(2) Employees who become members of the
regular work force after the date of this Award, September 15, 1978, shall
be provided the same protection afforded under (1) above on completion of
six years of continuous service and having worked in at least 20 pay periods
during each of the six years.

(3) With respect to employees hired into
the regular work force after the date of this Award and who have not acquired
the protection provided under (2) above, the Employer shall have the right
to effect layoffs for lack of work or for other legitimate reasons. This
right may be exercised in lieu of reassigning employees under the provisions
of Article 12, except as such right may be modified by agreement. Should
the exercise of the Employer's right to lay off employees require the application
of the provisions of Chapter 35 of Title 5, United States Code, employees
covered by that Chapter with less than three years of continuous civilian
federal service will be treated as "career conditional" employees.

The Employer's right as established in this
Section shall be effective July 20, 1979.

The following terms as to the employees'
and Employer's rights and the rules and procedures to be followed in the
implementation of Article 6 are a part of the September 15, 1978 Final Resolution
and shall be final and binding upon the parties:

A. Coverage

1. Employees protected against
any involuntary layoff or force reduction.

Those employees who occupy full-time, part-time
regular or part-time flexible positions in the regular work force (as
defined in Article 7) on September 15, 1978, are protected against layoff
and reduction in force during any period of employment in the regular
work force with the United States Postal Service or successor organization
in his or her lifetime. Such employees are referred to as "protected employees."

Other employees achieve protected status
under the provisions of A.3 below.

2. Employees subject to involuntary
layoff or force reduction.

Except as provided in A.1 and A.3, all
employees who enter the regular work force, whether by hire, transfer,
demotion, reassignment, reinstatement, and reemployment on or after September
16, 1978, are subject to layoff or force reduction and are referred to
as "non-protected employees."

3. Non-protected employees achieving
protected status.

(a) A non-protected employee achieves
protected status upon completion of six years of continuous service
in their regular work force. The service requirement is computed from
the first day of the pay period in which the employee enters the regular
work force. To receive credit for the year, the employee must work at
least one hour or receive a call-in guarantee in lieu of work in at
least 20 of the 26 pay periods during that anniversary year.

Absence from actual duty for any of the
following reasons will be considered as "work" solely for the purposes
of this requirement:

(1) To the extent required by law,
court leave, time spent in military service covered by Chapter 43
of Title 38, or time spent on continuation of pay, leave without pay
or on OWCP rolls because of compensable injury on duty.

(2) Time spent on paid annual leave
or sick leave, as provided for in Article 10 of the Agreement.

(3) Leave without pay for performing
Union business as provided for in Article 24 of the Agreement.

All other unpaid leave and periods
of suspension or time spent in layoff or RIF status will not be considered
work. Failure to meet the 20 pay period requirement in any given anniversary
year means the employee must begin a new six year continuous service
period to achieve protected status.

(b) Temporary details outside of the
regular work force in which the employee's position of record remains
in the regular work force count toward fulfilling the 20 pay periods
of work requirement per year.

(c) If a non-protected employee leaves
the regular work force for a position outside the Postal Service and
remains there more than 30 calendar days, upon return the employee begins
a new service period for purposes of attaining six years continuous
service.

(d) If a non-protected employee leaves
the regular work force and returns within two years from a position
within the Postal Service the employee will receive credit for previously
completed full anniversary years, for purposes of attaining the six
years continuous service.

B. Preconditions for Implementation
of Layoff and Reduction in Force.

1. The affected Union(s) shall be notified
at the Regional level no less than 90 days in advance of any layoff or
reduction in force that an excess of employees exists or will exist at
an installation and that a layoff and reduction in force may be necessary.
The Employer will explain to the Union(s) the basis for its conclusion
that legitimate business reasons require the excessing and possible separation
of employees.

2. No employee shall be reassigned under
this Article or laid off or reduced in force unless and until that employee
has been notified at least 60 days in advance that he or she may be affected
by one or the other of these actions.

3. The maximum number of excess employees
within an installation shall be determined by seniority unit within each
category of employees (full-time, part-time regular, part-time flexible).
This number determined by the Employer will be given to the Union(s) at
the time of the 90-day notice.

4. Before implementation of reassignment
under this Article or, if necessary, layoff and reduction in force of
excess employees within the installation, the Employer will, to the fullest
extent possible, separate all casuals within the craft and minimize the
amount of overtime work and part-time flexible hours in the positions
or group of positions covered by the seniority unit as defined in this
Agreement or as agreed to by the parties. In addition, the Employer shall
solicit volunteers from among employees in the same craft within the installation
to terminate their employment with the Employer. Employees who elect to
terminate their employment will receive a lump sum severance payment in
the amount provided by Part 435 of the Employee and Labor Relations Manual,
will receive benefit coverage to the extent provided by such Manual, and,
if eligible, will be given the early retirement benefits provided by Section
8336(d)(2) of Title 5, United States Code and the regulations implementing
that statute.

5. No less than 20 days prior to effecting
a layoff, the Employer will post a list of all vacancies in other seniority
units and crafts at the same or lower level which exist within the installation
and within the commuting area of the losing installation. Employees in
an affected seniority unit may, within 10 days after the posting, request
a reassignment under this Article to a posted vacancy. Qualified employees
will be assigned to such vacancies on the basis of seniority. If a senior
non-preference eligible employee within the seniority unit indicates no
interest in available reassignment, then such employee becomes exposed
to layoff. A preference eligible employee within the seniority unit shall
be required to accept such a reassignment to a vacancy in the same level
at the installation, or, if none exists at the installation, to a vacancy
in the same level at an installation within the commuting area of the
losing installation.

If the reassignment is to a different craft,
the employee's seniority in the new craft shall be established in accordance
with the applicable seniority provisions of the new craft.

C. Layoff and Reduction in
Force

1. Definition. The term
"layoff" as used herein refers to the separation of non-protected, non-preference
eligible employees in the regular work force because of lack of work or
other legitimate, non-disciplinary reasons. The term "reduction in force"
as used herein refers to the separation or reduction in the grade of a
non-protected veterans' preference eligible in the regular work force
because of lack of work or other legitimate non-disciplinary reasons.

2. Order of layoff. If
an excess of employees exists at an installation after satisfaction of
the preconditions set forth in (B) above, the Employer may lay off employees
within their respective seniority units as defined in the Agreement.

3. Seniority units for purposes
of layoff. Seniority units within the categories of full-time
regular, part-time regular, and part-time flexible, will consist of all
non-protected persons at a given level within an established craft at
an installation unless the parties agree otherwise. It is the intent to
provide the broadest possible unit consistent with the equities of senior
non-protected employees and with the efficient operation of the installation.

4.Union representation.
Chief stewards and union stewards whose responsibilities bear
a direct relationship to the effective and efficient representation of
bargaining unit employees shall be placed at the top of the seniority
unit roster in the order of their relative craft seniority for the purposes
of layoff, reduction in force, and recall.

5. Reduction in force.
If an excess of employees exists at an installation after satisfaction
of the preconditions set forth in (B) above and after the layoff procedure
has been applied, the Employer may implement a reduction in force as defined
above. Such reduction will be conducted in accordance with statutory and
regulatory requirements that prevail at the time the force reduction is
effected. Should applicable law and regulations require that other non-protected,
non-preference eligible employees from other seniority units be laid off
prior to reduction in force, such employees will be laid off in inverse
order of their craft seniority in the seniority unit.

In determining competitive levels and competitive
areas applicable in a force reduction, the Employer will submit its proposal
to the Union(s) at least 30 days prior to the reduction. The Union(s)
will be afforded a full opportunity to make suggested revisions in the
proposal. However, the Employer, having the primary responsibility for
compliance with the statute and regulations, reserves the right to make
the final decision with respect to competitive levels and competitive
areas. In making its decision with respect to competitive levels and competitive
areas the Employer shall give no greater retention security to preference
eligibles than to non-preference eligibles except as may be required by
law.

D. Recall Rights

1. Employees who are laid off or reduced
in force shall be placed on recall lists within their seniority units
and shall be entitled to remain on such lists for two years. Such employees
shall keep the Employer informed of their current address. Employees on
the lists shall be notified in order of craft seniority within the seniority
unit of all vacant assignments in the same category and level from which
they were laid off or reduced in force. Preference eligibles will be accorded
no recall rights greater than non-preference eligibles except as required
by law. Notice of vacant assignments shall be given by certified mail,
return receipt requested, and a copy of such notice shall be furnished
to the local union president. An employee so notified must acknowledge
receipt of the notice and advise the Employer of his or her intentions
within 5 days after receipt of the notice. If the employee accepts the
position offered he or she must report for work within 2 weeks after receipt
of notice. If the employee fails to reply to the notice within 5 days
after the notice is received or delivery cannot be accomplished, the Employer
shall offer the vacancy to the next employee on the list. If an employee
declines the offer of a vacant assignment in his or her seniority unit
or does not have a satisfactory reason for failure to reply to a notice,
the employee shall be removed from the recall list.

2. An employee reassigned from a losing
installation pursuant to B.5 above and who has retreat rights shall be
entitled under this Article to exercise those retreat rights before a
vacancy is offered to an employee on the recall list who is junior to
the reassigned employee in craft seniority.

E. Protective Benefits

1. Severance pay. Employees
who are separated because of a layoff or reduction in force shall be entitled
to severance pay in accordance with Part 435 of the Employee and Labor
Relations Manual.

2. Health and Life Insurance Coverage.
Employees who are separated because of a layoff or a reduction in force
shall be entitled to the health insurance and life insurance coverage
and to the conversion rights provided for in the Employee and Labor Relations
Manual.

F. Union Representation Rights

1. The interpretation and application of
the provisions of this Award shall be grievable under Article 15. Any
such grievance may be introduced at the Regional level and shall be subject
to priority arbitration.

2. The Employer shall provide to the affected
Union a quarterly report on all reassignments, layoff and reductions in
force made under this Article.

3. Preference eligibles are not deprived
of whatever rights of appeal such employees may have under applicable
laws and regulations. However, if an employee exercises these appeal rights,
the employee thereby waives access to any procedure under this agreement
beyond Step 3 of the grievance-arbitration procedure.

G. Intent

The Employer shall not lay off, reduce in
force, or take any other action against a non-protected employee solely
to prevent the attainment of that employee of protection status.

What follows is information, documentation
and arbitration awards which support the requirement in Article 37.3.E.5 that
a PAA be included on all posted duty assignments.

The PAA must include the duties as well as
the area. It is not sufficient to merely state a station or a branch as the
PAA.

The settlement of case Q90C-4Q-C-C 93034647
makes it clear the reason for a PAA is "to provide relevant information
to employees who are interested in bidding for jobs in order that they make
an informed decision when deciding to bid jobs."

That position is clearly supported by the Q
& A on Mail Processing Clerk and the attached regional awards and handbook
citations.

Our members deserve to know more than the hours
and off days of a duty assignment when they are bidding. We must enforce the
agreement and require that all duty assignments are worked the way they were
bid. Otherwise our bidding procedure is nothing more than a sham.

Other Duties as Assigned

Problem: The Union grieved the inclusion of
the phrase "other duties as assigned" on duty assignments postings when it
is not in the Standard Position Description. There was abuse by some supervisors
who viewed this phrase as giving then the ability to assign any work they
chose to employees e.g. adding window duties to a mail processing clerk.

The Union has taken the position that when
work is assigned to clerks for duties not in their position description, it
must be done in accordance with Article 7, Section 2 and other applicable
provisions of the Agreement.

This settlement reiterates the posting requirements
in Article 37.3.E, including "principal assignment area" This allows clerks
to make an informed decision when bidding for jobs.

Finally the settlement makes clear the phrase
"other duties as assigned" cannot conflict with the Agreement and other memoranda,
e.g. "day to day seniority" for mail processing clerks.

The parties agree to conduct a review of all
pending arbitration cases and Step 3 grievances for a ninety (90) day
period beginning on March 1, 2003 and ending on May 30, 2003. This review
may be extended by mutual agreement of the parties at the Area/Regional
level.

Beginning immediately after the signing of
this memorandum of understanding, APWU/USPS teams will be created for
the express purpose of reviewing all pending arbitration cases and Step
3 grievances. To the extent possible, these teams will be responsible
for advocating the cases not resolved during the review. The Area/Regional
parties will meet with all individuals designated to participate in the
review to outline expectations surrounding this review.

Removals, continuances, and other issues as
agreed to by the USPS Area Manager, Labor Relations and the APWU Regional
Coordinator will continue to be scheduled during the 90-day review period.

At the conclusion of the review process, the
parties agree to an arbitration scheduling process (as outlined below)
for a period to end no later than December 30, 2003, unless the national
parties mutually agree to extend the time frame.

1. The following principals regarding the
arbitration process will be adhered to during the above-referenced time
frame:

a. Area/Regional parties will jointly determine
the dates and locations for cases to be scheduled for arbitration, prior
to soliciting dates from arbitrators.

b. A scheduling letter will be generated and
dates assigned no later than 90 days prior to hearing.

c. The parties at the Area/Regional level
will share a list of advocates no less than 65 days before the hearing.

d. Advocates will meet telephonically, if
appropriate, to discuss scheduled cases no less than 55 days before the
hearing.

e. Advocates will submit a status sheet to
the Area/Regional parties listing both the cases to be heard for that
date and the cases pre-arbed/withdrawn, no less than 15 days prior to
a scheduled hearing date.

2. It is agreed that when time permits, a
minimum of two regular and three expedited arbitration cases will be heard
before an arbitrator, per arbitration date.

3. Arbitration cases will be reviewed and
scheduled for arbitration as follows:

a. All cases in a facility/installation.

b. All cases in a district by facility/installation.
The parties may move to the next facility/installation only after all
cases are either settled or scheduled for arbitration within the current
facility/installation.

c. Utilizing central locations for arbitration
hearings when appropriate and possible, to ensure that the parties arbitrate
the maximum number of cases possible.

4. Advocates, with the exception of APWU national
officers and USPS area advocates, will not be permitted to move cases
from expedited to regular arbitration without advance approval of the
APWU Regional Coordinator or the Area Manager of Labor Relations.

5. National level disputes will be jointly
identified and disseminated to the Area/Regional parties to ensure that
any grievances regarding these disputes are held at Step 2, pending a
final decision at the national level.

6. This memorandum of understanding will not
disrupt any existing modified grievance/arbitration program, unless mutually
agreed to by the parties.

7. The Area/Regional parties will develop
programs and devise methods to address the issues of grievance/arbitration
backlogs and grievances in-flow.

The parties recognize
that internal recruitment and development of current bargaining unit career
employees for skilled positions is in the best interest of postal employees
and the Postal Service. The parties agree to the establishment of
a process and program to allow for developmental opportunities for placement
of current APWU bargaining unit career employees in the Maintenance department.

In order to improve the opportunity for career APWU bargaining unit employees
to qualify for and establish themselves on the appropriate in-craft and/or
in-service register(s), the Postal Service will develop and implement
a program in those locations where a need is identified. The program
will include a process whereby APWU career employees will have an opportunity
to express interest in entering a developmental program for future opportunities
in the maintenance craft.

Once created and implemented, APWU bargaining unit career employees who
express an interest will be given an opportunity to qualify for placement
in the program and subsequent placement in a position in the Maintenance
craft. Placement into the Maintenance Craft will follow the provisions
of Article 38 of the current APWU-USPS collective bargaining agreement.

If the initial placement resulting from successful completion of the training
program is to an Electronic Technician (ET) duty assignment, upon placement
into the craft duty assignment, employees will commit to a three year
lock-in for that craft from the date placed in the assignment. The
employees will not be able to request transfer, in-craft downgrade or
bid to a non-skilled position during the lock-in period, but same position
designation transfers and in-craft promotions in the installation are
permitted. If an employee leaves before the end of the lock-in period,
the employee will be responsible for reimbursing the Postal Service for
all training costs.

As skilled Maintenance and Motor Vehicle craft positions are identified,
developmental programs will be established where needed. Non-skilled
employees already assigned to the craft for which the developmental training
opportunity assignment is intended will have first priority to qualify
for the available training.

__________________________
__________________________
Anthony J. Vegliante
William Burrus
Vice President
President